In late February the Opportunity Maine political action committee gathered enough signatures to get a referendum onto this November’s ballot that they hope will encourage recent Maine graduates to stay in the state after graduation. The ballot will read: “Do you want to allow a tax credit for college loan repayments to any taxpayer who earns a future college degree in Maine and continues to live and work in Maine?”
In the 2000 Census, the most recent information available, 21- to 24-year-olds with a bachelor’s degree in Maine reported making about $7500 less than Massachusetts workers with the same educational background. According to HousingTracker.net, in the last quarter of 2006 Portland residents spent 22 percent of their income on housing, while Boston residents spent 29 percent. So the difference in living expenses comes close to making up for the lower salary when considering the age group of 21- to 24-year-olds. Then why are college students leaving Maine after graduation?
The answer is advancements and promotions. The next age group, 25- to 34-year-olds with a bachelor’s degree, reported making almost $11,000 more per year in Massachusetts. People are not leaving the state because they will make more money immediately, but because in the long run, they will earn a larger return on their educational investment.
Opportunity Maine says higher-education debt has more than doubled in less than a decade and that Mainers are concerned that after they graduate they won’t be able to support themselves.
Out of three major state universities, University of Maine in Orono, University of Massachusetts in Boston, and University of New Hampshire in Durham, UMaine’s tuition with room and board is by far the cheapest, whether a student is paying in-state or out-of-state tuition. A student from Maine can graduate from UMaine for less than $27,000. In-state tuition with room and board at UMass is $54,156, while UNH is $71,940.
There’s no denying that the University of Maine system is a good deal: with out-of-state tuition plus room and board costing $44,372, it is still less than in-state tuition at either UMass or UNH.
So UMaine’s cost alone will draw out-of-state students to study here. But the Maine Tax Credit for College Loan Repayment is only going to help students who paid in-state tuition. Losing graduates who weren’t Maine residents (15 percent of students at UMaine, according to director of university relations Joseph Carr), is not a consideration for this initiative. The credit will also only equal the loan amount for tuition at the University of Maine or the Maine Community College System, meaning anyone graduating from a more expensive Maine school will get only a portion of their loan as a credit.
But Opportunity Maine encourages voters to view the tax credit as an investment in Maine’s economy. One of the largest reasons businesses choose an area for development is a highly educated workforce, according to Opportunity Maine campaign director Rob Brown. Maine is 30 percent behind the New England average for salary and 30 percent behind for degree attainment. By encouraging Maine residents to achieve higher education, Opportunity Maine believes the state will become a more desirable place for businesses.
“This is not a silver bullet,” says Brown. “This is not going to cure the higher education problem immediately, but we need to make a long term and lasting impact on Maine’s economy and this is the most efficient way to do that.”